Afghanistan Going Through Economic Crisis Since U.S. Pullout

By Esther Fultz

Markets don’t exist in a vacuum.  Social and political factors constantly influence the economy.  This is apparent across American history and can be seen in the Afghan economy following the withdrawal of U.S. troops in August.  While data regarding the economic situation in Afghanistan is currently sparse, the deterioration is apparent.

The World Food Program reported a 2021 increase from 42 million to 45 million people worldwide teetering on the edge of famine.  Afghanistan accounts for nearly all of this increase, with 23 million people in the country of 38 million currently suffering from acute hunger. The immediate reason for this crisis is loss of foreign aid.  

“After the Taliban came back to power, some $9 billion, $7 billion of which is held by the United States, was frozen and rightfully so,” said Dr. Duerr, Associate Professor of International Studies at Cedarville University.  “If there was a concrete way to use the money to help civilians, that would be different. It’s almost impossible to get to the civilians without the Taliban skimming off the top.”

Aggravating this problem is the hesitancy of foreign investors.  With no trustworthy government, solid rule of law, or stable economic condition, even countries like Pakistan and Iran who might generally be more sympathetic are refusing to invest in Afghanistan.

“Afghanistan’s currency has depreciated against other foreign currencies, and therefore it’s devalued,” said Dr. Sterkenberg, Associate Professor of International Business at Cedarville University.  “If you even made one [afghani] suddenly, maybe even six months later, it’s worth even less.”

When it comes to short-term solutions, providing aid that will actually get to the Afghan people is crucial.  Christians give a lot of private aid around the world, but because of the Taliban being in power, very few Christian organizations want to be on the ground. While some of these organizations can smuggle in humanitarian aid, the process is challenging.  The Red Cross has been able to enter the country and help civilians, but is unable to provide the amount of aid governments would be able to.

Regarding viable long-term solutions, Afghanistan must move past dependency on foreign aid and work towards establishing itself as a player in the global economy. 

 “They have to produce something the rest of the world wants,” said Sterkenberg.  “Robert Martini of the Red Cross once said that no humanitarian organization can replace the economy of a country.  We need to continue the humanitarian aid, but then we need to get the economy of the country running.”

Esther Fultz is a sophomore Social Work major and an Off-Campus and On-Campus writer for Cedars.  She enjoys writing songs, spending time outdoors, drinking coffee, and hanging with friends.